Internet piracy is a hot topic issue. Across America and other industrialized nations, millions of people are file sharing, illegally transferring copyrighted works. While this behavior is certainly illicit, the record labels have struggled with exactly how to prosecute so many people. Meanwhile, plagued with mismanagement and poor releases coupled with a bad economy, corporate record labels like Sony, EMI, and BMG have seen their revenues plunge.

The International Federation of the Phonographic Industry (IFPI), parent organization of RIAA, believed it had finally found answer -- lobby for the enactment of anti-piracy laws that would force ISPs to sever the internet of those sharing copyrighted works. The only problem was no one opted for such laws that would potentially cut millions of internet-using citizens from the internet.

At last, France became the first to officially make headway towards passing such legislation, thanks to personal support from French President Nicolas Sarkozy. The bill passed through the French Senate and only awaited the National Assembly -- France's equivalent to the House of Representatives. The bill would create a "three-strikes" policy for file sharers.

The government would pick up the tab (at taxpayers' expense) to police the internet and search for file sharers. If someone was found file sharing, they would be sent a warning email. This would be followed with a letter to the internet service provider (ISP)-provided address. On the "third strike" the ISP would cancel their service, and they would be disallowed to purchase services from other ISPs.

A major obstacle was European Union laws that prevented such policies. However, in a special EU meeting of Prime Ministers and Presidents, President Sarkozy bullied the other leaders into agreeing to overturn the ruling, essentially throwing out the European Parliament's consensus.

However, the bill has been struck down by the National Assembly, ultimately undone by a variety of opposing views. One major sticking point was the reaction from ISPs who were concerned about potentially losing millions in revenue by being forced to sever large number of customers. Then there were concerns voiced over increased government surveillance and the fact that hackers or internet squatters could usurp innocent users’ connections and lead to their ouster.

The record industry has struggled in court over proving that file uploads and downloads originated from a specific person's hardware -- a particularly thorny issue for colleges and other locations where multiple people can use the same IP address.

Socialist parliamentarian Patrick Bloche cheered the rejection of the bill, which he called "dangerous, useless, inefficient, and very risky for us citizens." Two members of Mr Sarkozy's own majority government party broke party lines to vote in opposition to the bill.

Beaten back, President Sarkozy still has plans to punish the pirates. He and his ministers are working on revised legislation with softer terms, which they will try to reintroduce later in the year.

"If you can find a PS3 anywhere in North America that's been on shelves for more than five minutes, I'll give you 1,200 bucks for it." -- SCEA President Jack Tretton